Almost nine months after his sports betting package was shot down by then Governor Rick Snyder on the eve of 2019, Michigan Representative Brandt Iden got the first hearing of the year on sports betting Tuesday morning. The event before the Regulatory Reform Committee was short and sweet: Iden shared stories about his weekend sports betting in Indiana, three committee members asked questions, three cards were read in, and less than 20 minutes later, the meeting adjourned.
HB 4916, filed last Wednesday, is a 21-page bill that allows for state-wide mobile betting, sets the tax rate at 8 percent, mandates the use of “official league data” for Tier II, or in-gam wagering, and allows for sports betting at commercial and tribal casinos.
Iden’s bill is tie-barred to online casino bill, HB 4311, which means that bill must pass in order for sports betting to become legal.
Iden: ‘We have to be competitive’
Iden has been championing sports betting in Michigan since before the Supreme Court struck down the Professional and Amateur Sports Protection Act in May 2018, and Tuesday said he hopes this attempt will move quickly so Michigan to-be licensees can offer legal sports betting in time for the Super Bowl.
“We have to be competitive with other states,” Iden said in his introduction, during which he pointed to neighboring Indiana’s early September launch of sports betting. “You will lose bettors to other states.”
The Packers and Bears are kicking off the 100th NFL season Thursday, and now, people can legally bet on the games in Indiana.
Blue Chip Casino had a pretty special guest place the first wager, as @DJManouWSBT shows: https://t.co/nKR6WWeAgQ
— WSBT (@WSBT) September 5, 2019
To illustrate his point, Iden shared details of his weekend, which involved driving 45 minutes from his home to the new FanDuel Sportsbook at the Michigan City, Ind. Blue Chip Casino Hotel and Spa, where he laid down bets on the Michigan-Army game and several other events. Iden painted a picture of Michigan license plates dotting the parking lot, and fans jammed into the sportsbook on the opening weekend of the NFL season.
Besides betting against Michigan — and losing — on Saturday, Iden placed a bet on the Cardinals. “On Saturday, I also placed a futures bet for Sunday … I bet on the Cardinals, the spread was 2 ½ points, I’m always betting against the Lions,” he said, as he reached into his jacket pocket for his betting slip. “They’re always going to blow it … it was fun. I present (my betting slip) as Exhibit A to the committee.
“I use this as an example. I decided to go there, because like many people interested in gaming, I go where the options are. … And, by the way, I filled up my gas tank, it was 10 cents cheaper, and I had lunch in Indiana. I spent all of my disposable income there.”
Starting over after veto
Michigan was poised to be among the first crop of states to move on sports betting late last year, when Snyder vetoed a package of iGaming bills on Dec. 28. The bills in that package wouldn’t have legalized sports betting, but would have set the table for state-wide mobile, among other things. At the time, Iden was blindsided and deflated, as he watched countless hours of negotiating with his peers and tribal interests wash away.
“I am surprised and disappointed. With this many stakeholders on board, it took us two years to get to this point, and it’s the first time in any state history that we had all the parties that were supportive of the bill (on the same page),” he said in December.
But Iden renewed his commitment in 2019, though odds of passage are no sure thing.
What is everyone giving Michigan's chances in 2019 on sports betting? Has to be at least a slight 'dog for passage, no? 2/1 seems reasonable to me. https://t.co/T0V62FkzL1
— Brian Pempus (@brianpempus) September 6, 2019
With the exception of at least one committee member who considers the tax rate in the bill too low, the bill did not spark controversy or much discussion Tuesday.
The tax rate and the mandate to use official league data will likely be key discussion points going forward. But Iden had quick answers to both Tuesday. Both Republican Chairman Michael Webber and Representative Sara Cambensy questioned the tax rate, which at 8 percent is certainly friendly to potential operators, who consider 10 percent or lower a workable rate.
Webber asked if the rate was competitive and Cambensy, a Democrat, said she felt Iden needed to get “more creative” with the rate. Neighboring Indiana’s tax rate is 9.5 percent.
“As you’ve read in the media as I continue to pursue this, the tax rate has become a major issue,” Iden said in his reply to Webber. “There is an opportunity to move this upwards, probably slightly, but I give my word I won’t advance these (bills) until I can find some resolution.”
The underlying message is that Iden is still negotiating the tax rate with new Democratic Governor Gretchen Whitmer.
Official league data for Tier II wagers
With regard to the use of official league data, Tennessee became the first state to play ball with the pro leagues this year. The Volunteer State not only became the first to legalize mobile-only sports betting, but the first to mandate the use of official league data. Illinois quickly followed suit, and it looks like the leagues might get another break in Michigan.
“The leagues do have a place here,” Iden said. “These are their games, their players, and if everyone has a seat at the table, it will make for the best experience.”
The bill calls for the use of official league data only to settle in-game wagers.
Michigan has an established casino infrastructure and like Indiana or Iowa, could likely go live with sports betting within months of it becoming legal. As Iden illustrated, the state is surrounded by competitors for sports betting dollars — Indiana and Illinois both have legal sports betting, though Illinois is months away from going live; Ohio has been investigating legalizing sports betting, and Canada, just over the Detroit River from Detroit, has long been a casino gaming competitor.
At the close of the hearing, Chairman Webber read in three cards indicating that the Michigan state budget office is opposed to the bill, and that a representative for the NBA, PGA and Major League Baseball and operator DraftKings are both “neutral” but support legal sports betting.
